In March 1989 a severe outbreak of respiratory disease occurred in horses in the Jilin and Heilongjiang provinces of Northeast China that caused up to 20% mortality in some herds. An influenza virus of the H3N8 subtype was isolated from the infected animals and was antigenically and molecularly distinguishable from the equine 2 (H3N8) viruses currently circulating in the world. The reference strain A/Equine/Jilin/1/89 (H3N8) was most closely related to avian H3N8 influenza viruses. Sequence comparisons of the entire hemagglutinin (HA), nucleoprotein (NP), neuraminidase (NA), matrix (M), and NS genes along with partial sequences of the three polymerase (PB1, PB2, PA) genes suggest that six of the eight gene segments (PA, HA, NP, NA, M, NS) are closely related to avian influenza viruses. Since direct sequence analysis can only provide a crude measure of relationship, phylogenetic analysis was done on the sequence information. Phylogenetic analyses of the entire HA, NP, M, and NS genes and of partial sequences of PB1, PB2, and PA indicated that these genes are of recent avian origin. The NP gene segment is closely related to the gene segment found in the newly described H14 subtype isolated from ducks in the USSR. The A/Equine/Jilin/1/89 (H3N8) influenza virus failed to replicate in ducks, but did replicate and cause disease in mice on initial inoculation and on subsequent passaging caused 100% mortality. In ferrets, the virus caused severe influenza symptoms. A second outbreak of influenza in horses in Northeast China occurred in April 1990 in the Heilongjiang province with 48% morbidity and no mortality. The viruses isolated from this outbreak were antigenically indistinguishable from those in the 1989 outbreak and it is probable that the reduced mortality was due to the immune status of of the horses in the region. No influenza was detected in horses in Northern China in the spring, summer, or fall of 1991 and no influenza has been detected in horses in adjacent areas. Our analysis suggests that this new equine influenza virus in horses in Northeast China is the latest influenza virus in mammals to emerge from the avian gene pool in nature and that it may have spread to horses without reassortment. The appearance of this new equine virus in China emphasizes the potential for whole avian influenza viruses to successfully enter mammalian hosts and serves as a model and a warning for the appearance of new pandemic influenza viruses in humans.(ABSTRACT TRUNCATED AT 250 WORDS)